Good evening Ladies and Gentlemen:
Gold: $1,220.50 DOWN $3.25 (comex closing time)
Silver 16.34 UP 8 cents
In the access market 5:15 pm
i) the May gold contract is a non active contract. Yet we started the month with 5.67 tonnes of gold standing and it has increased every single day and today sits at 6.886 tonnes of gold standing:
The amount standing for gold at the comex in May is simply outstanding at 6.886 tonnes. The previous May 2015, we had only .08 tonnes standing so you can certainly witness the difference as the demand for gold by investors/sovereigns is on a torrid pace. This makes the excitement for June gold that much more intense as more players are refusing fiat and demanding only physical metal. I will be reporting daily as to how which is standing for delivery through the active month of June. June is the second largest delivery month after December.
Despite the whacking of silver, it’s OI refused to decline like gold. Our bankers and the CFTC are “quite baffled” by this. We are now in our 6th year of high open interest in silver with a low price. This has never happened before.
If I am a betting man, it looks to me like China is the long taking delivery in gold and they are the longs waiting patiently to strike in silver.
Let us have a look at the data for today
At the gold comex today we had a POOR delivery day, registering 0 notices for NIL ounces for gold,and for silver we had 19 notices for 95,000 oz for the non active May delivery month.
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 256.189 tonnes for a loss of 47 tonnes over that period
In silver, the open interest FELL by 1793 contracts DOWN to 201,889 DESPITE THE FACT THAT THE PRICE OF SILVER WAS UP by 2 cents with respect to YESTERDAY’S trading..In ounces, the OI is still represented by just over 1 BILLION oz i.e. .1.009 BILLION TO BE EXACT or 144% of annual global silver production (ex Russia &ex China)
In silver we had 19 notices served upon for 95,000 oz.
In gold, the total comex gold OI fell by a CONSIDERABLE 17,864 contracts DOWN to 525,094 as the price of gold was DOWN $5.40 with yesterday’s trading(at comex closing). They certainly got the liquidation in gold but not silver.
With respect to our two criminal funds, the GLD and the SLV:
We had no change in gold inventory at the GLD The inventory rests at 868.66 tonnes. .
We had no change in silver inventory at the SLV/Inventory rests at 335.739 million oz
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver FALL by 1793 contracts DOWN to 201,889 as the price of silver was UP by 2 cents with YESTERDAY’S trading. The gold open interest FELL by 17,864 contracts as gold was down $5.40 yesterday. Somebody big is standing FOR SILVER and surrounding the comex with paper longs ready to ponce once called upon to take out physical silver.I also believe that for the first time we are witnessing players wishing to stand for real physical in gold. Gold investors, in the May contract month, are refusing the tempting fiat offer as they want only physical.
2 a) Gold trading overnight, Goldcore
(Mark OByrne/off today
2b) Gold trading earlier this morning;
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/ THURSDAY morning: Shanghai closed UP BY 7.37 PTS OR 0.26% / Hang Sang closed UP 29.06 OR 0.14%. The Nikkei closed UP 15.11 POINTS OR 0.09% . Australia’s all ordinaires CLOSED UP 0.29% Chinese yuan (ONSHORE) closed UP at 6.5576 . Oil ROSE to 49.88 dollars per barrel for WTI and 50.15 for Brent. Stocks in Europe MOSTLY IN THE GREEN . Offshore yuan trades 6.5611 yuan to the dollar vs 6.5576 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE WIDENS A BIT.
REPORT ON JAPAN SOUTH KOREA AND CHINA
a) REPORT ON JAPAN
The all important Tankan manufacturing sentiment was released and it was at a 3 year low:
“Tankan manufacturing sentiment at three-year low: The Reuters Tankan sentiment index for manufacturers fell to 2 in May from 10 in April, driven by exporting industries, with the survey projection pointing to 5 in August. According to the report, the service sector index fell to 19 in May from 23 in April, weighed by retailers, while the survey projection points to 18 in August. The story attributes the decline to the rising yen’s impact on exporters as well as domestic demand via tourism spending”
b) REPORT ON CHINA
i)Here are some comments on what will happen inside China. I strongly believe that the correct response is Daiwa.
The author believes hat the yuan will fall to 7.5 to the dollar, something that Kyle Bass and Soc Gen agree. They believe that the FX reserves will fall to below 2 trillion dollars in 2 years.
( Daiwa/zero hedge)
ii)Late this afternoon we get word that the USA will add a huge 450% anti dumping duties on corrosion resistant steel. China is absolutely furious!
( zero hedge)
Spain’s 7th largest bank Banco Popular saw its shares plummet by 20% as there is a new rights offering trying to shore up its balance sheet. The bank now must issue over 2 billion of new shares. The low interest environment is killing this bank along with all of the others:
(courtesy Business Recorder and special thanks to Mark. W for sending this to me)
5.RUSSIAN AND MIDDLE EASTERN AFFAIRS
Saudi officials crack down on the futures contract in the Saudi Riyal as it falters four months out. This could lead to a huge black swan event. If the dollar continues to rise, the peg will suffer more and this would cause oil ( a commodity) to fall with the rise in the dollar. Massive USA dollars leaves the Kingdom which itself causes problems. Thus the Saudi’s must devalue their riyal, something they do not wish to do. However if they devalue then there will be a run on all mid-eastern currencies as they must devalue also to stay competitive.
( zero hedge)
David Stockman comments on the intensifying global reflation ripping apart the globe.
a must read..
( David Stockman/ContraCorner)
i)Nigeria has a new terrorist group attacking oil facilities. Today Niger Delta Avengers (NDA) pre-announced a morning raid on Chevon and sure enough it is off line. Nigeria is in deep financial trouble;
( zero hedge)
ii)Oil tops 50 dollars for the first time since October
( zero hedge)
iii)With rising oil prices and with the Saudis worried about Iran, Cunningham is betting the farm that the oil freeze is over and they will all pump at full blast
( Cunningham/Oil Price.com)
9. PHYSICAL MARKETS
i)A great graphic of the London Gold Market and where gold is stored. This is a repat from two weeks ago but it is worth repeating.
ii)Nick Barisheff cannot figure out why billionaires are buying ETF’s like GLD which probably has no gold and not buying his bulllion fund which is 100% allocated like Central Fund and Sprott
“For an electronics manufacturer to come directly to us — that tells me something is changing in the market,” said Keith Neumeyer, chief executive officer of First Majestic, the top stock in Canada and among its global peers this year. “I think we’ll see three-digit silver,” he said, predicting the metal could surge to $140 an ounce by as early as 2019.
USA STORIES WHICH MAY INFLUENCE THE PRICE OF GOLD/SILVER
i)Core durables slump which sends the dollar reeling:
( zero hedge)